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In Parliament


Energy Policy - Matters of Public Importance

   Wednesday, 6 September 2017

Mr T. SMITH (Kew) — It is my pleasure to join this matter of public importance as moved by the member for Caulfield. It is apt that I follow the member for Eltham, who made some extraordinary claims in her less than, shall we say, accurate oration of some note this afternoon. I remind the member for Eltham, and indeed the Minister for Energy, Environment and Climate Change, who is doing such a wonderful job on behalf of, I suppose, inner‑urban lefties — no‑one else — that the head of a major Labor‑aligned union said that:

some Andrews government ministers still have their ‘heads in the sand’ about Hazelwood power station’s closure.

State secretary of the CFMEU’s Victorian mining division, Geoff Dyke, is pushing for new lower emission brown coal generators to be built, or for government to invest in research so one of Victoria’s abundant resources can be used in other ways.

With regard to baseload power, Mr Dyke went on to say that it ‘depends on what minister you talk to’ as to what they see as baseload energy for Victoria’s future.

This whole issue is essentially an ideological quest by this Labor government to move to renewable energy at the cost of baseload power, at the cost of Victorian consumers and indeed industry. Why, I ask you? Because they are paranoid about losing inner‑urban votes to the Greens. It is that simple. None of this makes any sense with regard to the policy settings of this government. There is a simple matter of cause and effect here. If you close down a power plant, prices will rise. It is that simple. You have not replaced the 22 per cent that has been lost with the closure of Hazelwood with anything else. This is just simple economics, it is simple supply and demand, yet they are trying to have us believe that their inability to keep Hazelwood open has not added to the cost of electricity in this state.

The CFMEU are not, can I say, the natural friends of the Liberal Party, but with regard to baseload energy that keeps people in jobs in the Latrobe Valley and in paper mills in Gippsland, the CFMEU and the Liberal Party would appear to be in agreement with one another that you need baseload power, that windmills and solar panels are not the answer to the malaise afflicting our baseload power industry in this state.

We are facing great challenges this summer. The energy market operator has made it very clear that we have a 10 per cent higher chance of blackout than South Australia — 43 per cent, they would say. There is a 43 per cent chance that we will have a massive blackout this summer. Where are we living? Are we living in Victoria, the great home state of Sir John Monash who gave this state abundant, cheap and reliable energy? No, what we have now is an energy sector and indeed a state government that quite frankly, to quote the CFMEU of all people, have their heads in the sand.

This minister, quite frankly, is completely out of her depth and does not understand these issues. She seems to be of the view that we will increase energy supply because of a legislated renewable energy target. That bears no resemblance to fact. We have lost 22 per cent of the sector. What is she doing to replace that 22 per cent? She is saying that we have to have 40 per cent of energy being generated by renewables by 2025. Well, when I was in Gippsland recently GHD told me that the only way they will reach their renewable energy target by 2025 is by closing the Yallourn power plant. If we lose Yallourn, that is another 20 per cent of our energy grid gone.

I say to the government: what are you doing? Silly Lily, please listen to us. I know you go and talk to businesses, but do you listen to them? Do you listen to what they have to say, listen to them about their energy bills, listen to consumers? There was a 7 per cent rise in consumer energy bills in the March quarter. These are the issues that matter to mainstream Victorians. It may well be fine in Fitzroy North to sip a latte and not really care about your energy bill because you can afford it. But for all of us who are not climate change warriors, who just want to have the lights kept on and not have them go off in the peak of summer or in the depths of winter, who just want to pay our energy bills at the lowest possible price, who want industry to survive in its current form and not have to lay off staff because it cannot afford its energy bills, these are the issues that Victorians want answers to.

At the moment the response from this government is threefold. It is to, one, blame Canberra; two, say ‘Trust us because we are going to have more wind turbines’, and three, just hope for the best because there is not really a problem here. There is a fourth — we might import energy from Tasmania. Victoria has been a net energy exporter for the best part of 50 years and the fact that this once‑proud state that has 400 years worth of brown coal left in reserve is going to be reliant on states like Tasmania for its energy future I think is pretty embarrassing.

The Labor Party was once the party of workers. It was once the party of cheap, free, reliable, accessible energy that would keep people in manufacturing jobs and would allow working families to keep the lights on. I am afraid that the modern Labor Party has moved away from its industrial core and indeed its mission to advocate the issues of lower socio‑economic areas. It is those people, as the Victorian Council of Social Service observed recently, who are bearing the brunt of the rise in energy prices.

The fundamental contention for modern Labor is: does it chase the inner‑urban green vote that is consistently concerned about climate change and interrelated environmental issues or does it return to its working‑class core for cheap energy that will drive manufacturing jobs, cheap energy that will enable working families to pay energy bills? We have had 2000 disconnections in recent times of people who simply cannot pay their bills because their bills have exploded out of control since Hazelwood closed down.

We hear commentary from the government that it is not their fault that Hazelwood closed, that it was a commercial decision by a foreign‑owned company. There are a couple of points that have to be made about that and the point about the coal royalty being increased substantially has been well made by other speakers. I simply make this observation: it is the government’s job at the end of the day to keep the lights on. You can blame companies as much as you like, you can blame the operator, you can do whatever you like, but you made absolutely no effort, whether by government investment or by any other mechanism, to keep the doors of Hazelwood open.

The member for Caulfield made the correct observation that there were at least three turbines at Hazelwood that had a substantial amount of life left in them but no effort was made to keep them operating. I think it is to the government’s eternal shame that 22 per cent of our energy grid disappeared on their watch. The simple fact is that come election time they can make as many excuses as they like. They can blame the French, they can blame the feds, but they will never blame themselves. The simple fact will be that the Victorian people will blame them because it happened on their watch. Twenty‑two per cent of our grid evaporated overnight and of course energy prices went up. Their excuse, in fact their response, to fix that is that we are going to have a few more wind turbines down on the south coast. Well, that is not going to cut the mustard at all because we have a baseload energy crisis in Victoria that this government does not know how to fix.

I think the government will be severely punished by its mainstream voter base in the outer suburbs and indeed regional Victoria, because it is these people who are on the front foot — indeed the front line — of having to deal with this massive increase in energy prices. I can assure you that it will be the Liberal and National parties who will be reminding Victorians every single day between now and the next election that this happened on the Labor Party’s watch and that only the Liberal and National parties believe in baseload power by fossil fuels, by coal and by natural gas, and we are the only people that can get downward pressure on energy prices, put baseload power back into Victorian energy policy and get rid of that ridiculous renewable energy target.